Grand cru Bordeaux winery sold to Chinese

BORDEAUX, FRANCE – A Chinese industrialist has completed the landmark purchase of Chateau Bellefont-Belcier, a leading estate in France’s prestigious Saint-Emilion wine-making area, sources involved in the sale said Thursday.

The property is the first of its rank — grand cru classe (classified great growth) — to be acquired in what has been a wave of Chinese investment in Bordeaux.

The new owner is a 45-year-old industrialist with assets in the iron sector who has already diversified into the wine importing business. He met the chateau’s employees Friday and has since returned to China.

Chinese investors have acquired around 30 lower-ranked properties in Bordeaux — the larger region that includes Saint-Emilion — over the past two years. This year has seen China become the region’s biggest export market in terms of volume.

So far, Chinese investment has not been controversial in a region with a long tradition of foreign ownership of wine estates.

In contrast, the acquisition by a Chinese buyer of Chateau Gevrey-Chambertin in Burgundy earlier this year triggered a major row, with local winemakers and far-right politicians claiming the country’s heritage was being sold.

“This is a first (for Bordeaux), we’ll see how people react,” said Herve Olivier, regional director of SAFER, the government agency that oversees rural land development.

Georges Haushalter, the president of the Bordeax Wine Council, does not expect a backlash. “We have the Japanese at Chateau Beychevelle and Chateau Lagrange and no one reacts against them,” he said. “They have done a very good job.”

Bellefont-Belcier, which had been on the market for a number of years, has 13 hectares of vines and total land of 20 hectares. A source close to the transaction said the final price was between €1.5 million ($1.9 million) and €2 million ($2.6 million) per hectare of vines.

The sale had been in negotiation for a number of months, but the price was not finalized until after the announcement in September of a once-in-a-decade reclassification of Saint-Emilion wines, which confirmed the estate’s grand cru status.

“The classification played an enormous role,” said a spokesman from Franck Lagorce Conseil, the agency that negotiated the deal. Without the classification, “the price would not have been the same.”

Olivier said another 10 chateaux could be sold to Chinese buyers by the end of the year if bureaucratic obstacles can be overcome.

Chinese investors in Bordeaux are primarily industrialists with diverse business interests including real estate and tourism, according to Olivier.

Until now, Chinese have focused on relatively obscure chateaux in modest appellations, because the properties have frequently languished on the market for some time and there is little chance of a bidding war.

For this reason, according to Olivier, Chinese investors have not put pressure on vineyard land prices. “They don’t make the prices shoot up like in Gevrey Chambertin,” he said. “Prices have remained stable.”

The controversy in Burgundy was fueled by the fact that Macau gambling executive Louis Ng outbid a group of local investors. Inflation in land prices is a sensitive issue because of the impact it has on inheritance tax and, as a consequence, the ability of families to pass vineyards down to the next generation.

“Bordeaux vineyards have always been open to foreign investors,” Olivier underlined. “There have been trends — the English, Belgians, Americans, Japanese, insurance companies, banks, which have purchased chateaux. Today, it’s the Chinese.

“What is different is that it’s in such a short period. They’ve purchased 30 estates in two years. That’s something.”